San Diego Scammers Target Military In $4.8M Life Insurance Scheme: Indictment - Insurance News | InsuranceNewsNet

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July 17, 2019 Life Insurance News
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San Diego Scammers Target Military In $4.8M Life Insurance Scheme: Indictment

Paul Flanagan, 54, Ranjit Kalsi, 52, and Gregory Lee Martin II, 49, were arraigned this week for operating a life insurance scheme to defraud United States Military personnel out of $4.8 million.

Kalsi and Martin were arrested on July 9 by the San Diego Sheriff’s Warrant Team, and were arraigned July 10. Flanagan was arraigned. All pleaded not guilty.

The San Diego County Grand Jury issued a 69-count criminal indictment on July 8, accusing the three of deceiving young service members into signing up for unwanted life insurance policies and annuity contracts.

The indictment includes charges of grand theft, the illegal use of personal identifying information, forgery, conspiracy to commit forgery, conspiracy to commit a form of insurance fraud known as “twisting”—making misrepresentation to consumers to convince them to take out insurance policies, and a white collar crime enhancement.

“These defendants defrauded an honored group of individuals who have dedicated their lives to protecting and serving our nation,” said Insurance Commissioner Ricardo Lara. “The alleged actions of these individuals have resulted in the loss of $4.8 million and has harmed thousands of military personnel. I am committed to working with the San Diego District Attorney’s Office and the Attorney General’s Office to put a stop to those who take advantage of hard working Californians.”

Operating as Go Navy Tax Services, Flanagan, Kalsi and Martin submitted more than 4,700 applications for life insurance policies and annuity contracts to insurance companies under the scheme. The defendants earned over $2 million in commissions on the sale of these products over a 3-year period.

Go Navy Tax Services operated out of a trailer across the street from Naval Base San Diego. The trailer, adorned with military seals and symbols to imply that the business was affiliated with the United States Military, advertised free income tax preparation for service members.

“The victims of this scam were young women and men serving our country who were essentially tricked into signing up for something they didn’t need and couldn’t afford,” said San Diego County District Attorney Summer Stephan. “Working with our law enforcement partners in California and at the Navy, we were able to shut down this operation and we will work to get money back into the pockets of service members who were taken advantage of.”

During the free tax preparation service, defendants obtained personal identifying information from their victims and used it to open new bank accounts in the service members’ names at a bank in Kentucky, investigators said.

Defendants then initiated automatic, monthly allotments from the service members’ paychecks to the bank, from which the unauthorized insurance premiums were paid to the insurance companies, investigators said.

The case is being prosecuted by the San Diego District Attorney’s Office and the California Attorney General’s Office. The California Department of Insurance Investigation Division acted as the lead investigative agency, working jointly with the San Diego District Attorney’s Office, the Attorney General’s Office, the Office of the Inspector General-Navy, and Naval Criminal Investigative Service.

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